Forest Products: Trade Policy Highlights


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	FOREST PRODUCTS TRADE POLICY HIGHLIGHTS - NOVEMBER 2005
	U.S. Paper on Forest Products Liberalization in the World Trade Organization
	On October 14, 2005, the United States tabled a joint paper with Canada, Hong Kong China, New Zealand, and Thailand outlining the benefits of a forest products sectoral initiative under the DOHA Development Agenda of the World Trade Organization (WTO). The paper describes how liberalization in the forest products sector would increase market access and offer WTO members opportunities to enhance their competitiveness by lowering input costs and by setting the stage for increased investment in forest products processing industries. In addition, the paper describes how a sectoral agreement on forest products would effectively address the “tariff escalation” problem. Within the forest products sector, unprocessed wood products often enter countries duty-free, or at minimal tariff levels, while tariffs on further-processed wood products are, in some countries, substantially higher. Currently, the average applied tariff rate on forest products for WTO members is 11 percent while the average bound rate is 36 percent. Developing countries in particular stand to make significant gains from a sectoral agreement on forest products. At a time when the world is increasingly concerned about the sustainability of its natural resources, trade barriers on forest products have the effect of distorting harvesting decisions and the flow of investment capital. Tariff liberalization would increase the intrinsic value of forests and foster long-term planning focused on sustainability, providing substantial commercial, social, and environmental benefits. The Doha Development Agenda includes negotiations on a range of subjects, and work on issues related to the implementation of agreements arising from previous negotiations. TN/MA/W/64